Thursday, September 6, 2012

Budget Update

Phew! September is here. Our monthly budget resets, and we don't have to scrape by (at least for the first part of the month). 

We reinstated our strict budget halfway through August. It was a particularly rough month because we spent $100 a week on Henry's swimming lessons, and we essentially paid double in childcare costs. Henry's authentic Montessori school is now in session (which we had to pay for in May), but they phase in the new children one by one, so he doesn't start until September 10. 

I know I sound whiny when I talk about our budget. We are extremely fortunate to be able to send our son to our top-choice school and provide him with expensive swim instruction. And we eat primarily organic food. Tightening our spending is a choice. It's not due to a job loss or illness--we are very lucky and fortunate. 

We're choosing to really tighten our belts right now because we want to continue to send Henry to private school until Austin has a free public Montessori option, I want to take another maternity leave if/when we have a second child, we want to continue eating food that is as healthy as possible, and we want to build our dream house while interest rates are amazingly low (and because I want to feel settled and put down deep roots into the neighborhood and community where I'm working to build a school).

But wanting to save for all those things doesn't make the act of doing it any easier. I feel like The Enforcer, always saying things like, "Well, if we're going to eat out tonight then one of us will have to pay with our personal allowance because we have no money left in our general account for the month." I want to buy Henry a balance bike because he's so interested in bikes right now, but we don't have that kind of disposable income. I find myself accidentally not purchasing as many fruits and vegetables in an attempt to keep our grocery bill in check, which affected Henry's regularity this week. Awful!

According to my estimates, we have more than a year left of living like this. I'm trying to figure out how to a) make living within a strict budget more enjoyable and b) keep up our strict budget for the next 12+ months. First, I went back to our monthly budget (which is based on this Excel document). Then we started a account to look at our actual spending (instead of trying to sift through credit card and bank statements manually). I had to increase a couple of the categories based on what we were actually spending, but I managed to find an extra $100 in the end (primarily because I was rounding down my income initially). Matt suggested that we add $50 to our general monthly fund and $25 each to our personal allowances for the month (bringing us up to $60 each for the month). 

I'm hoping that the extra little padding + swim lessons only once per month through the winter = a more sustainable and enjoyable life within a strict budget. I'll let you know how it goes!

Piggy bank available on Etsy

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Ellie said...

Firstly, see if you can find a kid's bike on craigslist or freecycle and just take the pedals off; no need to buy a special bike, I think.

Secondly, do you shop in bulk at all? My husband and I found that doing 3 mos worth of shopping at Costco helped with our food budget - we could buy a 2-3 month supply of organic milk, yogurt, cheese, frozen fruit, and things like quinoa and Israeli couscous. It helped a lot with making room in our budget for our CSA share and to buy fresh fruits and vegetables, and it meant we maximized our membership there enough to have the cost actually be worth it. Or there might be a food co-op or bulk ordering program run by the city (Baltimore has one) that you could participate in.

Katherine said...

Here's a link for a DIY cheap balance bike!

Sara E. Cotner said...

Hi, Ellie! How do you buy a 2-3 months' supply of things like milk and yogurt? Don't they go bad? And do they have a lot of organic products at places like that? It's definitely an intriguing idea.

Hi, Katherine! What an awesome blog! Thank you for introducing me to it. The problem with DIYing a balance bike for Henry (or finding one on Craigslist) is that I've only been able to find one type of bike that fits a 1.5 year-old's height. I figured out a solution though: Ask grandma for an early Christmas present!

Rebekah said...

Thanks for the suggestion to try I signed up and it looks so great!

Carrie said...

In my opinion, most young children's toys and clothes can be purchased used with great success. We have a very local "trading post" Yahoo! group in our new town, and I've found some great buys for our boys, including a huge bag lot of clothing for $30 and a 12" bike with training wheels for $12. As a point of note, my now 3.5-year-old hated the balance bike--a "Skuut", I believe. He loves his new 16" bike with training wheels. I don't see the rush with getting a child to ride a 2-wheeler without training wheels. I don't see the rush with lots of things in childhood.

Anonymous said...

Thanks for your posting! We're also trying to be more frugal, while also maintaining healthy habits.

Almost all the food we buy is also organic. We purchase the majority of our food from a local natural food store, but we also supplement by taking one trip a month to Costco to stock up on some items that we know we can get their that are organic and/or healthy, including a huge tub of organic salad mix for $3.99, walnuts, almonds, quinoa, dry bean/lentil mix, organic carrots, and hummus among other things.

Also, here's a wood balance bike that may be of interest:

Emily said...

We struggle mightily with budget as well. One thing that you might have seen is this NYT article:

The jist is that "organic" on a label doesn't really mean all that much anymore. Better to know the farmers and gardeners. Many local producers can't afford to buy into organic certification, but they are using natural methods and no pesticides.

Thinking carefully about our food and seldom eating out has made a bit more leeway for our big bills: mortgage, insurance, taxes.

Anonymous said...

I'm sure you already know this, but making your own foods is nearly always cheaper. You can make your own yogurt, cheese and bread at home (and granola!), and I know you're renting now, but a lot of veggies will grow in containers. I spent $10 on an heirloom tomato plant and so far (I've had it for just under two months) I've gotten 13 tomatoes at 1 lb each...probably would've gotten more but I made a couple mistakes. But you can also grow all kinds of peppers, eggplant, zucchini, blueberries etc in containers. Cheaper and in many cases 'more organic' than at the grocery store.
As for the bike, does Henry have a monthly allowance? Instead of you and Matt each getting an additional $25, you could give $25 to Henry and buy that bike in three months.

Ellen said...

Thanks for all of the updates on your budget and house building. My husband and I are also saving to buy a house and it's been really helpful to read about someone else's journey.

One of the things that comes across so clearly from your posts is how much you care and value your family. Nearly all of the things you're trying to shelter in your budget -- Henry's school, the house, healthy foods, are all things for your family's well-being and I really get that.

I don't doubt that you could pinch your pennies for the next year or so and and figure out how to make all of this work, but I'm wondering about the hidden costs -- the stress on you and your family and the amount of capacity you have to spend thinking about your budget. I am all for saving and living frugally, but when you're having to scrutinize every purchase it can become incredibly taxing and can have significant ramifications: ( Could it be worth cutting out or cutting back on one of these expensive wants just for a year or two or taking a few more years to save for the house so that you wouldn't have the stress of living so close to your means? Sometimes having just a little bit of cushion can be all that's needed to make everyone breath a bit easier.

Sara E. Cotner said...

@ Anonymous (2:35pm): Thank you for the reminder! We spend a ton on yogurt (fat-free for us and whole milk for Henry). All three of us drink smoothies for breakfast every day. I've made yogurt in the crockpot before and it was a cinch. I will definitely go back to making it myself!

@ Ellen: I definitely hear you! I keep coming back to two things: 1) interest rates are AMAZINGLY low. And interest rates make all the difference when you talk about borrowing money for 30 years. With current interest rates, we can get into a relatively expensive house on a 1/2 acre of land and have a low, low monthly payment (which will stay low forever!). I have no idea what is going to happen to rates after the election. I prefer to hurry up and try to get in while they're this low.

2) I really want to be settled. I'm tired of living someplace for a year (Denver), living in another place for three years (Houston), and renting a house on the south side of town when we want to live on the East (in Austin). I want to settle into the home that Henry will grow up in. Hopefully, I'll get pregnant again and have a homebirth in the house. I already feel like we've waited long enough to put down roots (Henry will have moved three times by age 3). I know I sound impatient. I also know that I am completely bringing this stress upon myself. But to me, it feels worth the short-term stress to achieve long-term goals.

The extra little padding that I added plus the fact that we aren't spending so much on Henry's swimming anymore has made this month feel a lot better. Hopefully it doesn't feel as stressful this month. I honestly don't know what we would cut out. I can't imagine not sending Henry to a Montessori school. He's in the prime years of developing the core of his personality.

I'll go check out that article now!

Bridey said...

It's really interesting to hear about your budgeting journey. When we drop down to one income next year we're going to be on a pretty strict budget too.

For me food is going to be the hardest thing to budget for. I think I'll be making a lot more from scratch but it will still be a bit of a stretch!

I've been really enjoying Mr Money Mustache but I need to actually start putting some frugality ideas into practice now!

Maria said...

Couldn't you help out at your son's school and get a discount? It certainly doesn't hurt to ask when your budget is this tight. Most daycares are thrilled to get some help. I used to make all the snacks for mine, like packing lunch for a small army.

This sounds stressful, especially for over a year (yikes!). I wouldn't be able to sleep hoping the brakes wouldn't go out or nobody had to fly somewhere for a funeral. Been there done that.

Sara E. Cotner said...

That blog looks awesome, Bridey! I just added it to my reader (and spent way too much time reading the archives...)

nichole said...

you inspired me Sara! I went through our budget (which got way out of wack this summer) to see where our financial missteps were occurring. Plenty places! Oh boy, we too, are back on a financial diet!

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